• Although it is not compulsory a landlord will usually require a tenant to pay a 'bond.’
  • A bond is a sum of money paid to a landlord before a tenancy commences to cover any potential future damage to property or non-payment of rent.
  • If no damage occurs and no rent is owing the bond will be refunded at the end of the tenancy.
  • There are sometimes limits on the amount of bond that can be demanded under a tenancy agreement.

• For example In Victoria a landlord cannot demand a bond greater than one month's rent if the weekly rent doesn't exceed $350.
• If the weekly rent is above $350 the limit is removed and the amount of bond becomes un-restricted.

• A bond will generally be requested after the tenancy agreement has been signed.
  • The agreement should contain information about the amount of bond to be paid and the date that the payment is due.
  • Once the bond has been paid the landlord will usually sign a completed a bond lodgement form.
  • This form must also be provided for the tenant to sign and the tenant must receive a copy.
• The bond lodgement form will then be filed with the residential bond authority in your relevant state.
  • The residential bond authority in each state or territory holds residential bonds paid by tenants to landlords in a trust account.
  • This provides tenants and landlords alike with a certain level of security and protection of their bond and premises.
  • If a landlord wishes to make a claim on the bond amount for damage caused by a tenant this will have to be made through the bond authority.
  • Likewise when a tenancy ends a refund can only occur through the bond authority if the landlord certifies that no damage has occurred and there is no rent owing.
• The landlord must lodge the bond with the residential bond authority.
  • The landlord cannot keep the bond and simply provide a receipt to the tenant.
  • If the landlord fails to deposit the bond within the relevant time period they can be fined a significant amount which can be greater than $2,000.
• Once the landlord has received the bond and completed the lodgement form the tenant should receive a receipt from the bond authority.
  • If no receipt has been received within a reasonable timeframe which is usually 14 days the tenant should contact the bond authority to follow up.
• Failing to pay bond within the set time period may give the landlord the right to issue a 'notice to vacate' to the tenants.
• A landlord cannot require you to pay additional bond just because rent has increased or a new tenant moves in.
• A landlord cannot require a tenant to provide a guarantee for the carrying out of their duties under the tenancy agreement if the tenant has paid bond.
• If the landlord does ask for a guarantee it cannot exceed the total amount of one month's rent.
• Disputes concerning condition reports are common in the field of residential tenancies.
  • If a tenant is required to pay bond to protect the landlord from the financial burden of repairing any damage caused by a tenant then it follows that the landlord should have to prove that the damage was actually caused by the tenant.
• Tenants will be provided with two copies of a completed condition report before moving into the premises.
  • Once moved in the tenant should check that the description of each item on the condition report accurately reflects the actual condition of that item at that point in time.
  • At the end of the tenancy the landlord may use the condition report as evidence to prove that a tenant has caused damage.
  • This evidence is difficult for a tenant to challenge as they themselves are the one that signed off on the condition of the house at the commencement of the tenancy.
  • The legislation also states that a condition report is conclusive evidence of the state of repair of the property at the time it was signed by the tenant.

• It is recommended that a tenant not sign the condition report until the tenant is satisfied that it accurately reflects the condition of the property.

Tenants may also wish to take photos or video of any damage that exists at the commencement of the tenancy so that these may be used in the event of a dispute.